I. Joinder, Consolidation and Civ.

Pro Stuff
Parklane Hoisery v. Shore (Non-Mutual Offensive Issue Preclusion)

Second plaintiff may use the result of previous litigation as to an issue that Defendant lost on, if it is the same issue, that was litigated,
and actually decided on matter necessary to judgment.
Guedry v. Marino (Permissive Joinder, Severalability)- Soft Application

Deputies not rehired b/c spoke out against sherrif before his election and racial discrimination. Alleged activity effects each P, so
common legal ?s, even if some questions are not similar.
DirectTV v. Adrian (Permissive Joinder, Severalability)- Strict Application

DirectTV suing people for stealing transmissions. Allegations of similar staturoty violations do not satisfy same TOO requirement.
Iron Workers Local Union v. Phillip Morris (Compuslory Joinder)

Trust case brought saying Phillip Morris did some dodgy financial things. Courts dont evaluate reqs for comp. joinder rigidly, look at
practicality.
Malcom v. Natl Gypsum Co. (Consolidation)

600 consolidated asbestos cases in one District for discovery. Consolidation was inappropriate b/c it was too confusing and the cases
to disparate for the jury to keep track of. Concern of prejudicing defendants rights.

II. Class Certification

Hansberry v. Lee (Certification Significance for Plaintiffs)

Land not allowed to have black people live on it. 1st suit decision upheld agreement. Court finds that this ruling d/n have preclusive
effect, because the 1st suit not adequate rep and thus not binding on the parties.
In re Rhone-Poulenc Rorer, Inc. (Certification Significance for Defendants)

Companys blood products infected hemophiliacs w/ AIDS. Posner decertified class b/c of overwhelming pressure to settle on
defendant despite history of victories in single trials.
o
(Contrast with EISEN- disallowing preliminary look at merits) (But this has diminished)
General Telephone Co. v. Falcon (Commonality/Typicality)

Mexican suing for promotion/hiring discrimination. No adequate rep where individual was hired but not promoted and is suing on
behalf of those unhired.
Dukes v. Wal-Mart I (Commonality/Typicality)

Current and former female Wal-Mart employees sued for discretionary discrimination by local supervisors. Not certified b/c
discretion leads to individual answers to claims, not common to whole class.
Phillips Petroleum Co. v. Shutts (23(b)(3) Opportunity to be Heard)

Natural Gas Co. owed royalties to 28000 respondents for a higher price being charged. In determining class, court found plaintiffs, to
be included in a (b)(3) class, must received notice and opportunity to be heard and participate in the litigation. Allow to opt-out.
Brown v. Ticor Title Ins. (23(b(1) and (2) and Monetary Damages)

Members of antitrust class action certified under b(1) and (2) who later attempted to bring dmages action based on the same facts were
not bound b/c due process required that class members be allowed to assert clams for damages)
Amchem Products, Inc. v. Windsor (Adequate Representation)

Asbestos settlement-only class certification failed because Claimants who have manifest injuries should not be represented or have
same counsel as those without manifest injuries. Also found as collusive, and that interclass conflicts create typicality problems. Lack
of common questions among Ps to create typical claimant. Thus no adequate representation.
Stephenson v. Dow Chemical Co. (Choice of Temporal Perspective- Es Post, backward-looking)

Vietnam vet developed cancer after settlement time limit had ended, disallowing him to recover. Applying an ex post analysis of
adequacy, the court found he was not bound by previous settlement, b/c he, not knowing of his potential injuries, was not adequately
represented (No SCOTUS precedential effect)
Uhl v. Thoroughbred and Telecommunications (Choice of Temporal Perspective- Ex Ante, forward-looking)

Class rep got certification for claim against company who was adding fiber optic cables to rail lines. The subclasses were of people
whod have the cable on their side of the land and those who wouldnt. They didnt know who would be in which group when class
was certified. Because rep d/n know which subclass shed eventually be in, she was adequate rep for both.
Cole v. GMC (Choice of Law affecting Predominance)

Airbags failed, nationwide class up for certification. All 50 states laws are implicated. The Plaintiffs presented only textual
similarities of different state laws. Variations among them defeated predominance, b/c individual questions of choice of law supersede
factual similarities.
In re Bridgestone/Firestone (Choice of Law Vested Rights application)

Nationwide class of tire consumers tried to frame issue as financial loss under contract theory to avoid COL problem. But, because
forum state applied vested interest, injury occurred at point of sale of tires, so all 50 states law implicated. Unmanageable, so
decertified.
In re Air Transportation Antitrust Litigation (23(b)(3) Manageability)

Price-fixing case found manageable despite difficulties with notice and large number of people. Notice concerns not prohibitive of
class actions, they just need to be reasonable efforts. Damage calculations that are time-consuming/tedious are not unmanageable if
calculation is mechanical/repetitive.
Hilao v. Estate of Marcos (23(b)(3) Manageability)

10,000 foreign nationals sued for crimes committed at lead of Philippine dictator under 23(b)(3) and the Alien Tort Claims Act. Used
statistics to create representative sample to create prediction of actual damages (cites Matthews v. Eldridge saying use of statistics no
violation of Due Process).
Klay v. Humana, Inc. (23(b)(3) Complete. Certification and Denial thereof)

Doctors suing HMOs for systematically underpaying bills. Raises federal (RICO) and state (contract) claims. Because racketeering
cant be proven on individual basis, it is ripe for certification (common questions law/fact). K claims had no common questions of
fact (though law was common). Class action was superior to joinder, consolidation, transfer and ind. trials.
Brown v. Ticor Title Insurance (23(b)(2) Damages Not Allowed)

Consumers suing for injunction and damages against title insurance company using (b)(2). Brown tried to opt-out an was not allowed.
This is violation of due process b/c where damages are in play, you must be afforded chance to opt-out.
Barnes v. American Tobacco Co. (23(b)(2) No medical monitoring under (b)(2))

Medical Monitoring sought under 23(b)(2). Medical Monitoring is not injunctive relief. Too individualized of defenses and facts of
each injury. Addiction highly personalized, as is need for MM, AOR defense, knowledge of plaintiff, etc.
Allison v. Citgo Petroleum Corp. (23(b)(2) damages claim must be incidental)

Civil Rights action was unsuitable for (b)(2) certification because monetary damages predominated the objective of the litigation
Wal-Mart Stores, Inc. v. Dukes (23(b)(2) damages claims barred)

Even back pay is now considered individualized relief, and not incidental to the injunctive relief. Effectively bars all but automatic,
statutory damages for (b)(2) actions.
Ortiz v. Fibreboard Corp. (23(b)(1)(B) Limited Fund Class Action)

Asbestos Cases, trying to establish a limited fund settlement for future claimants. Proposed future claimants do not have relationship
with attorneys. Substantial probability that claims would exhaust assets, resulting in bankruptcy, to establish limited fund.
In Re Simon II Litigation (23(b)(1)(B) Punitive Damages class rejected)

Certification of a punitive damages class against the Tobacco companies was decertified. Because punitive damages are necessarily
tied to compensatory damages per BMW v. Gore, State Farm and other cases, and thus would not be calculable with a defined
ascertained limit in class action setting. Postulated limited funds are not allowable.
Brown v. R.J. Reynolds Tobacco Co. (Issue Classes and Preclusion)

Extensive Tobacco Litigation in multiple phases. Question of whether the phases should have issue preclusive effect. So long as they
are actually adjudicated in their respective issue classes, they will be afforded issue preclusive effect if they are facts actually
decided by the jury.
In the Matter of Rhone-Poulenc Rorer (Issue Class, Reexamination)

Certified for negligence/common issues with later trials for individual liability. BUT individual trials involve individualized defenses,
such as comparative negligence, which necessitate reexamination of negligence.
In re Nassau County Strip Search Cases (Issue Class and Predominance Req.)

Nassau County strip searched everybody, regardless of crime. Liability was common issue. An issue class certification is allowable
regardless of whether claim as a whole satisfies predominance test. Certification of an issue class may be feasible regardless of
whether the whole class is certifiable under 23(b)(3)
Allen v. Intl Truck and Engine Corp (Mandatory and Opt-Out Issue Classes)

Former employees sued for racial discrimination damages and equitable relief. Class treatment of indivisible injunctive claims and
individal damages cases does not violate the 7th amendment. First trial as to injunctive relief, and issue preclusion for later trials
In re IPO Securities Litigation (Eisen Rule diminishes, Merits of Suit determined at Class Certification)

Securities class actions alleging fraudulent IPO issuance policies by major underwriters. Court determines that factual issues relevant
to Rule 23 must be resolved, even if they overlap with the merits.

III. Parallel Proceedings (CAFA, MDL and other methods of Coordination)

In re Oil Spill (MDL Transfer Orders under CAFA)

BP oil spill affected shores in multiple states, and this is transfer order for multiple suits in federal district courts across the gulf.
Dispute among plaintiffs and Defendants as to which court to centralize in. ED of La chosen b/c a geographic center of injury and
experienced judge
In re Silicone Gel Breast Implants (MDL Transferring to avoid prejudice)

Defendants and Plaintiffs could not agree on California/Ohio for forum to transfer to. Court sends to Alabama, an unrelated forum
with an experienced MDL judge to avoid prejudice to either party.
DeLaventura v. Columbia Acorn Trust (MDL and Settlement)

Criticizes settlement culture fostered by MDL. Courts hold on to trial-ready cases to encourage settlement.
Matsushita Electric Co. v. Epstein (Full Faith and Credit Act, Applying States Preclusion Effect)

State Court settled claims that could not be brought in state court. De Class action derivative suit against MEI for buying subsidiary
for less than it was worth. Separate California action filed w/ federal claims. De class settled state and federal claims, allowed for
opt-out. California non-opt outs fired collateral attack claiming lack of JUX for fed claims and inadequate rep. SCOTUS upholds
settlement b/c De would have upheld it.
Smith v. Bayer (Preclusion of State by Federal Ct. decision)

1st Suit filed in WV state, then removed to Federal Court and put in Minnesota MDL. 2nd Suit, Smith, filed in WV and stayed there.
Fed. Ct. case was not certified, but this did not have preclusive effect on Smiths certification b/c it involved the state certification law,
not the Feds (even if textually similar)
In re Corrugated Container Antitrust Litigation (Protection of Judgment)

MDL Class Action alleging antitrust. Plaintiffs counsel files competing class action in SC State Court. State court was found to risk
impeding imminent settlement, thus injunction was proper in aid of JUX and necessary to protect imminent final judgment
In re Eagle-Picher Industries (Necessary in aid of JUX/Risk of inconsistency)

Asbestos Limited Fund class action conditionally certified, moves to enjoin ongoing state proceeding. Found as necessary in aid of
JUX b/c continued litigation threatens fund over which court has JUX. Also worried about inconsistent judgments. LIMITED FUND
IS LIKE A RES- can issue injunction to protect individual class members interests.
Carlough v. Amchem Products (Necessary in Aid of JUX)

Fed. Class Action settlement filed, then a state class action filed in WV, claiming future claimants in state are not bound, wants
separate class action. D. Ct. enjoins state action as necessary in aid of JUX b/c settlement is imminent and state action would be
disruptive, create confusion for class members.

IV. Settlement Review and Design

Reynolds v. Beneficial Natl Bank (Review of Class Action Settlements 23(e))

Settlement of consumer finance class action where high risk of collusion among plaintiffs attorneys and defendant. Judge is
supposed to act as fiduciary for class at settlement and voluntary dismissal phase and here neglected that duty
Devlin v. Scardelletti (Who may seek appellate review of Class Settlement Approval per 23(e))

Benefits plan litigation. Petitioner requested to intervene in suit, but never moved to do so. He is nonetheless allowed to appeal b/c
the named class rep is not an adequate rep, naturally, if he wants to appeal. This treats the nonnamed class member a party to the
litigation, effectively (contrary to Hansberrry and Shutts). If you object, you can appeal.
Epstein v. MCA, Inc. (Epstein III) (Collateral Attacks on Class Settlements)

Second action filed alleging lack of adequate representation and questioning its preclusive effect. Both are factors in determining
validity of collateral attack. Three different standards are stated.
In re Prudential Ins. Company (Deterrence of Opt-Outs through Settlement Design)

Nationwide Class action, some plaintiffs opted out 2 of their 4 claims to sue on later. However, settlement provision included
injunction enjoining future claimants from bringing claims related to common nucleus of facts, thus practically destroying the opted
out claims. If theyd opted out all 4, they would not be parties and would not have been precluded
In re Inter-Op Hip Prostheses (Deterrence of Opt-Outs through Settlement Design)

MDL for faulty hip replacement mechanisms. Dickie Scruggs designs settlement including favored nation, liens on assets, walk out
provisions, etc. Some of the provisions are allowed, some arent. Settlement being so good its practically mandatory is representative
of how fair it is. Opt-out benefits being weak dont make it illusory.
Vioxx Settlement (Non-Class Settlement Walk Away Provision)

Terms were already agreed as to settlment. 85% walk away provision. To encourage to sign on, agreement had 100% attorneys
recommend deal to claimants and threaten to withdraw if they did not take it. Forced.
Burrow v. Arce (Fiduciary Duty of Plaintiffs Attorney)

Chemical Plant explosion. Mass contingency fee arrangements, lack of communication and threats of no recovery for those opposing
the counsel. An attorney who violates his fiduciary duty in the creation of an aggregate settlement will forfeit some or all of his fees,
to be determined by the court.
The Tax Authority v. Jackson Hewitt (Prohibition against Ex Ante Agreements for Non-Unanimous Consent)

Contract existed whereby all the members of the group had to abide by by the majoritys decision as to the aggregate settlement. K
was established beforehand. Found invalid. Attorney cannot get advance consent from clients to abide by majoritys decision about
merits of aggregate settlement.
In re Zyprexa Litigation (Court may adjust attorneys fees in Quasi-Class Actions)

Zyprexa caused injuries and pre-trial proceedings were consolidated by MDL Panel. Discovery and negotiations were handled by
special discovery master and special settlement masters. Pretrial settlement covering 8000 plaintiffs. Judge says This action is more
like a class action than individual action, and Id have power to award attorneys fees in a class action, so I should have that same
authority now.

General Attack Plan

1 How do you want to proceed w/ litigation?
a Rule 20 Joinder Requirements to Join s
a Both of the following requirements must be satisfied, based on the
allegations in the complaint, before
a Rule 20 joinder will be allowed.
i Federal Rule 20(a) allows for joinder of s if:
1 They assert any right to relief jointly, severally, or in the
alternative in respect of or arising out of the same transaction,
occurrence, or series of transactions or occurrences, AND
a The transaction or occurrence requirement is frequently
satisfied if the s are complaining about the same behavior
of the same in the same time frame.
a Courts are looking for a logical relationship between the s
claims. (This is a fact-based inquiry.)
1 There is any question of law or fact common to all these
persons.
a Only one common legal or factual question must exist.
a There is no requirement that all legal or factual issues be
common or that common issues predominate over
individual issues (except in the Rule 23(b)(3) type class
action.
i If the transaction or occurrence requirement is
satisfied, it is almost always possible to identify at
least one common or factual question
a Supplemental Jur (p. 16)
i Joinder Analysis
1 Is there a joinder provision in the Federal Rules that allows
assertion of this claim (or joinder of this party)?
1 If so, does this claim invoke an original basis for federal
jurisdiction such as federal question or diversity of citizenship?
If so, it may be asserted in the pending case.
1 If not, ask whether the claim can nonetheless be asserted in
federal court because it invokes supplemental jurisdiction.
a Federal Question Jurisdiction
i Well-pleaded part of s claim creates federal question
a Diversity of Citizenship Jurisdiction
i -corporation resides: (1) where incorporated and (2)
at its principle place of business
4

1 PPB means nerve centerwhere are the

administrators/the brains behind the operation
i -person resides wherever domiciled
1 Domicilephysical location and intent to remain
a Supplemental Jurisdiction Analysis
i Has asserted an original claim that independently
satisfies a basis for federal subject matter jurisdiction?
(if not, then supplemental jur. isnt applicable)
i Does the addl claim form part of the same case or
controversy as the claim with original federal
jurisdiction?
1 If so, 1367(a) grants the federal courts
supplemental jurisdiction over the claim, but that
is not the end of our inquiry because although
1367(a) giveth, 1367(b) may taketh away.
1 Does the original claim (the one that got the case
into fed. Ct. in the first place) invoke diversity of
citizenship jur. under 1332? (if not, skip to #4)
1 If so, 1367(b) may prohibit the exercise of
supplemental jurisdiction. Note that 1367(b)
does not apply to federal question cases under
1331.
1 1367(b)s prohibition of supplemental
jurisdiction in diversity cases applies only to
claims asserted by s or parties subsequently
joined on the s side of the litigation.
1 1367(b) deals only with diversity actions; it
will kick out a claim if the claim is a:
a claim by s against persons made parties
under Rule 14 (third-party practice), 19
(joinder of persons needed for just
adjudication), 20 (permissive joinder of
parties), or 24 (intervention) of the
federal rules
a Claim by persons proposed to join as P's
under Rule 19 (joinder of persons
needed for justification of adjudication)
a claim by persons seeking to intervene as
s under Rule 24 (intervention)

1 If there is still supplemental jurisdiction

under 1367(a) (after applying 1367(b), if
applicable), is there some reason for the court
to decline to exercise supplemental
jurisdiction under 1367(c)?
a Compulsory Joinder
i Rule 193 Step Practical Assessment
1 Is the absentee necessary?
a Rule 19(a)(1)(A) Complete Relief Prong absentee
should be joined if, without him, complete relief cannot be
accorded among those already parties.
i The concern here is protecting the from a hollow or
partial judgment. (The focus is on the parties, not the
non-parties whose joinder is at issue.)
a Rule 19(a)(1)(B) Prejudice Prong absentee must
have an interest in the subject of the suit that is legally
protected and not merely a financial interest or interest of
convenience. In addition, Rule 19(a)(1)(B) requires that
failure to join the absentee will harm either the absentee
(Rule 19(a)(1)(B)(i)) or the (Rule 19(a)(1)(B)(ii)).
i The goal here is to avoid prejudice to somebody, but if
it is the , they will likely argue multiple and
inconsistent obligations (which refers to where the
has to do X from Court 1 and Y from Court 2 and those
are inconsistentit does not refer to simply being sued
multiple times).
1 Is joinder of the absentee feasible? Includes 3 relevant factors:
a Absentee must be subject to service of process, which
means that he must be subject to personal jurisdiction.
a If the absentee objects to venue and joinder of the absentee
would render the venue of the action improper, the absentee
shall be dismissed.
a Joinder is feasible if joinder [of the absentee] will not
deprive the court of jurisdiction over the subject matter of
the action.
i Supplemental jurisdiction does not help here because it
is one of the claims barred by 1367(b)(prohibition on
a claim by a against a person made a party by Rule
19)

1 If joinder is not feasible, should the court (1) proceed without

the absentee or (2) dismiss the pending case? (19(b) factors)
a If a person who is required to be joined if feasible cannot be
joined, the court must determine whether, in equity and
good conscience, the action should proceed among the
existing parties or should be dismissed. The factors for the
court to consider include:
i the extent to which a judgment rendered in the
persons absence might prejudice that person or the
existing parties;
i the extent to which any prejudice could be lessened or
avoided by:
1 protective provisions in the judgment;
1 shaping the relief; or
1 other measures;
i whether a judgment rendered in the persons absence
would be adequate; and
i whether the would have an adequate remedy if the
action were dismissed for nonjoinder.
1 What type of class should be certified?
a Eisen said that you could not have a free floating inquiry into the merits
i In re IPO held that courts must make a definitive assessment that
each of the rule 23 requirements must be met, the court must resolve
the factual disputes even if they overlap w/ the merits, and the court
must still make a definitive assessment even if there is conflicting
evidence
1 The conflicting evidence may be expert testimony
a Daubert-- debate whether subject to Daubert at certification
or at trial, In re IPO says you have to resolve conflicting
expert testimony
1 After Eisen and IPO, can look into the merits as far as necessary
to definitely establish that the Rule 23 certification requirements
were met
a The probing into the merits must be for class certification
purposes only
i However, it is hard to divide between certification
based discovery and merit based discovery
a Basic Rule 23 req's
i Numerosity
7

i Commonalty
i Typicality
i Adequate representation
a Rule 23(b)(1)(A)-- Risks of incompatible standards of conduct
i Consider what the P's might ask for as relief if they proceed
independently
i If P's are successful in individual suits, would the D be able to
comply w/ all the adjudications are would some preclude others
(deferring money damages are not mutually exclusive)
a Rule 23(b)(1)(B)-- Limited Fund (when all parties seek recovery from
finite source of assets that will be exhausted before all expected claims are
satisfied)
i After Fibreboard, a D must be close to bankruptcy to establish a
limited fund
1 The Fibreboard court majority suggests that there must be a
substantial probability of bankruptcy
1 The Fibreboard court dissent suggests there must be a
significant risk that the total assets are going to fall well
below the value of the claims
i Applicable if P's proceeding individually would risk adjudication w/
respect to individual members of a class, which would as a practical
matter would:
1 Be dispositive of the interests of other members not parties to
the adjudication, or
1 Substantially impair or impede their ability to protect their
interests
i
Must demonstrate (not merely assert) substantial probability that
fund is inadequate to pay aggregate amount of all the claims
1 Figure out what the P's likely recovery will be
a Difficult to do if you havent had any prior cases to give
you a baseline to estimate damages (for example, an
immature tort)
i To help determine the limits of a fund, a judge could:
1 Look at settlements regarding this type of claim
that are not confidential
1 Have bellwether trials
a Difficult if the claims are unliquidated, like personal injury
tort claims
1 Figure out fund size available for satisfying claims
i Proposed distribution must be equitable among all class members
8

1 Cant discriminate against some class members

i Consider how much net worth defendant will retain (how close to
BR?)
1 In equity, a characteristic of a limited fund was the whole of the
inadequate fund is devoted to all the overwhelming claims
i Fund must be preexisting; the (b)(1)(b) cant create the fund
1 Cant carve it out of other available resources (Per Fibreboard )
a Rule 23(b)(1)(B)-- Limited Punishment Fund, talking solely about
punitive damage claims
i After In re Simon II, no chance of a limited punishment fund class in
(b)(1)(B)
a Rule 23(b)(2)-- Injunctions
i Requirements:
1 Pattern or practice that is generally applicable to a class as a
whole
a Useful to consider if remedy will settle the issue for all PLs
or if there will need to be individual relief
a if whole group isnt remedied, probably not action
generally applicable to the class( Divisible remedy or NonDivisible)
i Divisible entail distribution to one or more claimants
individually, without predetermining the application of
the same remedy to any other claimant in practical
effect
i Indivisible distribution of the remedy to any claimant
invariably affects the application of the same remedy
to other claimants
1 D conduct need not be directed to or cause
damage to every member of the class, provided
the defendants action is based on grounds that
have general application to the class
1 Constitutional challenge to a sexually segregated
public school, the policy is generally applicable to
the entire excluded class, though it may be
repugnant to a small part of the class, and the vast
majority of the class members may be opposed to
any change in policy.
1 P's are asking for injunctive or declaratory relief
a Injunctive or declaratory relief has been interpreted to
mean equitable relief
9

Equitable relief includes some remedies that may deal

with money, such as:
1 Back-pay for employment discrimination
characterized as equitable restitution rather than
legal damages; Disgorgement; Constructive trust;
Restitution; Equitable accounting
i Damages under (b)(2):
1 (Brown v Ticor) held that due process is violated when you
include monetary remedies that predominate over non-monetary
damages in a (b)(2) class (must have chance to opt out)
1 (Allison v Citgo) held that monetary damages in (b)(2) class
may only be allowed when the damages are incidental to the
indivisible remedies
a The court used an incidental test and said that these other
damages shouldnt require additional hearings and
shouldnt introduce new and substantial legal or factual
issues nor entail complex individualized determinations
a Two requirements:
i Money damages must flow automatically from the
injunction
i The damages are easily calculable
1 Dukes v. Walmart:
a Damages under a 23(b)(2) action are all but barred.
b While there is still technically an idea that damages that do
not predominate, and incidental to the action will be
allowed, it is an extremely limited standard
c Even backpay is no longer allowed
d Certain automatic statutory awards may be permitted,
but nothing else.
1 Courts could always certify the injunctive portion as a (b)(2)
class action and the monetary portion as a (b)(3) class action
a Rule 23(b)(3) requirements
i Predominance
1 P will argue predominance over the entire case (5th Cir.Castano)
a The cause of action as a whole must satisfy the
predominance requirement of (b)(3)
a Argue that legal standard requires only that common
questions predominate, doesnt require absence of
individual issues,
10

a the P will then argue that critical questions are common to

all class members
a Will argue that D cannot defeat certification by arguing the
court to pre-judge the merits (see Rhone Poulonc)1 D will argue predominance requirement in each issues class
a Courts may separate out limited issues under (c)(5) and
then conduct the limited inquiries (2d Cir. Nassau Strip
Search cases)
a Emphasize the differences in individual class members
claims and argue that those differences, in light of the
differences in the underlying claim, would require a "minitrial" for each class member
a They will look for individualized defenses that can be
applied be applied affirmatively against the P's that will
require specific facts
Superiority
1 Interest in separately controlling the actions (negative value suit,
low damages make individual litigation cost prohibitive, w/o the
class suit, individual adjudication probably wouldnt proceed)
a P will argue class members dont have an interest in
controlling their individual litigation
i b/c the claims themselves are too low value
a D will argue the claims are high enough that there is value
to bring them on their own
1 The extent and nature of any litigation concerning the
controversy already begun by or against class members
a P arguments
i If presence of pending litigation, then this makes class
action superior, b/c cases can be heard together
(promotes judicial economy); or
i If absence of pending litigation, class action is superior
b/c it shows individuals dont have enough at stake to
bring their own claims
a D argues
i The presence of pending litigation shows that a class
action is not superior b/c P's have sufficient incentive
to suit w/o the need for a class action, and courts
should not take away those P's autonomy w/o a need to
do so; or

11

If absence of pending litigation, then this shows a class

action is not superior, b/c there is no prior track record
of trials from which the court can draw information
1 Desirability of concentrating the litigation of the claims in a
particular forum
a P argues (see Klay):
i Substantial economies of time, effort, and expense for
litigants in the court
i When the amounts in controversy would make it
unlikely that P's would pursue individual claims (see
negative value suit above)
i The forum has already handled prelim matters and put
in significant effort
a D argues inverse, difficulty of getting the evidence to one
spot, etc
1 Likely difficulties in managing a class action
a P argues you can have subclasses to make it more
manageable
a D argues that having to apply the laws of all 50 states
would make the class action unmanageable
a Choice of law-- state law that applies will determine
whether the common issues predominate
i If the issue involves state law claims, the choice of law
may affect whether common issues predominate (if all
federal claims there would be no choice of law issues)
i 3 steps for choice of law:
1 Identify a conflict
1 Identify the applicable choice of law principles
1 Apply the principles
i P:
1 to avoid choice of law problems, get outside the
category of state law problems in the 1st place,
specifically plead what might at first glance seem
like state tort or contract claims as violations of
some federal law (RICO)
1 Apply the contention that even though 50
different bodies apply to members of a class
spread across the country, those bodies of law are
in functional terms the same (see Cole v GM,
which failed)
12

1 Apply the contention that the applicable choice of

law principles point to the application of a single
body of state law, typically the law of the D's
principle place of business to the entire
nationwide class (see In re Matter of
Bridgestone/Firestone)
1 Could use subclassing to avoid such problems, see
outline p. 35 for more arguments
1 CAFA
a D's would prefer to remove the case, and CAFA acts as a useful tool b/c it
makes it easier to get cases into federal court
a Requirements:
i Minimal diversity, at least 1 P different from 1 D
i $5 Million at controversy, "either viewpoint" rule-- value as
determined from either the P or D
a Check for exceptions
1 MDL Panel
a Applies to cases in federal court, purpose is to avoid duplicative litigation
and inconsistent verdicts, panel decides whether to coordinate and where
to transfer, the transfer is technically only for pre-trial purposes
a standard for an MDL transfer is that the cases involve one or more
common questions of fact and are pending in different districts
i If pending in same district, use Rule 42 to consolidate the claims
a Transfer can be done either by a party through a motion or by the judge,
sua sponte
a Lexecon forbids the transferee court from hearing cases for trial; however,
there are different ways around this (see p. 59)
a Van Dusen, though technically decided under 1404 transfer says when you
transfer under 1404 transfer, the law of the original forum follows you
(same for 1407 transfer)
a However, w/ a 1406 (venue is improper) the law of the original forum
does not attach
b An argument made to the transferee court may be to reconsider something
the judge did in the original transferor court
i Law of the case-- generally courts wont overturn their previous
orders on the same issue, to get them to do so you would have to
argue changed circumstances
a Strategy:
i P: the MDL may force weaker and stronger claims to be lumped
together, and if you are a P w/ a strong claim, you will not like this
13

D: lot easier to coordinate when everything has been consolidated

through the MDL process
1 Though there may be some advantages to unconsolidated
litigation (reverse auctions may allow you to play P's off of each
other)
2 NOTE: Defendant cant remove to Federal Court under CAFA
and then use MDL to transfer for pre-trial and force settlement
(unless majority of Ps request transfer)
1 Dueling Class Actions-- Anti-Injunction Act, Rooker-Feldman, Full Faith and
Credit Act
a States Recognizing Other States Judgments
i Would the laws of the state in which the judgment originated
preclude the new action? (Full Faith and Credit Clause)
i Result in new state is what it would be in the originating state?
a Federal Court Recognizing Other States Judgments
i Would the laws of the state in which the judgment originated
preclude the new action? (Full Faith and Credit Act)
1 If so, as an exception of the Full Faith and Credit Act, 28 U.S.C.
S 1738, should the federal court refuse to give preclusive effect
to the state court judgment?
i Is there any express indication in the statute with the exclusive
federal jurisdiction that discusses its relationship with S 1738 or the
preclusive effect of related state court proceedings? (rare)
1 If not, do the concerns underlying a particular grant of exclusive
jurisdiction justify a finding of an implied partial repeal of S
1738?
a Congressional intent should be the primary consideration
a Doesnt matter if judgment from the state is waiver of
claims that could not be brought in state court so long as it
passes the above analysis
a Anti-Injunction Act Exceptions:
b 2283: fed court may not grant an injunction to stay proceedings in
state court unless
i as expressly authorized by congress
ii where in necessary aid of the fed. Courts JUX
iii to protect or effectuate fed judgments (relitigation exception)
1 use All Writs Act (28 USC 1651) to provide the positive
authority for fed courts to issue injunctions of state court
proceedings

14

2 NOTE: Smith v. Bayer. Strict interpretation of the

litigation exception. If state is applying its own law, Fed
Ct. d/n preclude it to protect judgment (not same issue)
1 Settlements-- Rule 23(e)-- voluntary dismissal and settlement of class actions
a Court must approve a settlement binding on a class only after conducting
a hearing and finding the settlement is "fair reasonable and adequate" (see
p. 66 for evaluating the fairness of a settlement)
i Rule 23(e)(1)(B)-- must direct notice in a reasonable manner to all
class members that would be bound by a settlement
a CAFA's effect on settlements (see p. 67): coupon settlements, settlements
resulting in a loss to class members, geographic location, and notice to
governmental officials
a Class action objectors: Rule 23(e)(5) permits objections to be withdrawn
only w/ the court's approval; 23(e)(3) requires parties seeking a settlement
to identify any agreement made in connection w/ the proposed settlement
i Devlin v Scardeletti held that the right to appeal is not restricted to
the named parties. Non-named class members are parties to the
proceeding in the sense of being bound in the settlement. As a result,
so long as they objected to the settlement in a timely fashion at the
district court level, they are allowed to challenge the settlement on
appeal w/o being required to intervene in the case.
1 Devlin was decided under a (b)(2) class action, it is undecided
whether a party has to intervene in a (b)(3) class, seems that in
(b)(3) the party must intervene or opt out
a Collateral Attacks-- 23(e)(4)(A) any class member may lodge objections
to a proposed settlement
i Most likely to be filed in state court b/c it is harder for the D in a
state court to enjoin the federal court
i In a collateral attack, the P is arguing an exception to Full Faith and
Credit b/c no due process was provided
i P's get around claim and issue preclusion by:
1 Looking to the requirements of preclusion-- P may say they
werent the named party in the previous lawsuit (not the same
party), were not in privity with the named P's, and were not
adequately represented
1 Do a full frontal collateral attack based on due process
(adequacy of representation)
i Two moving parts to the debate over collateral attacks (p.71)
a Deterrence of Opt outs through Class Settlement Design

15

Opt outs are not a good thing for P attorneys or D attorneys (see p.
72)
b Methods:
i Settlement provisions which enjoin the use of the common
nucleus of facts in the settlement (In re Prudential)
ii All assets of the defendant secured by a lien held in trust in
favor of settling parties
iii Objectors cannot be paid until lein expired
iv Favored Nation- any better settlements acquired later would
automatically up the provisions of the settling class
(discourages cherry picking)
v Walk away provisions: if we dont get some percentage
participation, no settlement
vi Prevention of opt outs from getting funds before the settling
class
vii
a Aggregate Settlements
b 2 or more clients claims are resolved by same lawyer
i Model Rule 1.8: to do so, need IC of each client. Disclosure to
them requires:
1 Total amount of aggregate settlement
2 Existence and nature of all claims and defenses involved
3 Details of every other clients participation in settlement,
their contribution and receipt
4 Total fees paid to lawyer and whether they will be paid
from settlement fund or ortherwise
5 Method by which costs are to be apportioned
c Quasi-Class Actions (p. 77)
d Basically an Aggregate settlement which occurs through MDL
e The nature of a quasi-class action is virtually undefinable and it is a
sort of shotgun from the hip approach by the judge to wholistically
look at litigation and determine whether it is so like class action that
their role becomes a fiduciary and supervisory one.
i Vioxx, Zyprexa Products
ii Judge has power to reduce fees- acts as fiduciary like a certified
class action judge would

16

FULL Complex Litigation Outline

I.

Intro and Advanced Joinder

Preclusion:
Full Faith and Credit generally requires every State to give to a judgment at
lest the preclusive effect that the judgment would be accorded in the State
that rendered it.
o Even if it is patently incorrect
o Except for judgments rendered w/o PJ or SMJ.
o Remedy is to appeal, not sue in another court.
Claim Preclusion (Res Judicata)
Issue Preclusion (Collateral
Estoppel)
Prevents litigation of a claim or
Prevents relitigation of issues that
defense that was or could have been were litigated, even if in the context
litigated in prior action
of a totally different claim
Elements
Elements
Final judgment
Same issue
On the merits
That was litigated and
Binds parties and those in
Actually and decided and
privity
Necessarily decided
In subsequent litigation arising
Cannot be relitigated by same
out of same transaction or
parties
occurrence
On all claims or defenses that
were or could have been
litigated
Claim Preclusion:
Requirements:
o Final Judgment
o On the merits
o Binds parties to action AND those in privity with the parties
o Claims must arise out of same Transaciton or Occurrence
o Must be claims that were or could have been litigated

17

 Case 1 and Case 2 must be brought by SAME CLAIMANT (or those in

privity with claimant) against the SAME DEFENDANT (or those in privity
with defendant)
Case 1 must have ended in valid, final judgment on the merits
o Validity: court in case 1 had SMJ and PJ over parties. If so, judgment
is valid
o Finality: ends litigation and trial court does nothing but execute
judgment
Just b/c case is on appeal d/n mean it is not final; it may have
preclusive effect
o On the merits:
Based on substance of plaintiffs claim and/or defendants
defenses, not on procedural ground
Dismissal for lack of SMJ or PJ, improper venue, failure
to join a party under Rule 19 are not judgments on merits
12(b)(6) failure to state a claim IS on the merits
Rule 41(b) involuntary dismissal IS on the merits (but
Semtek says maybe not take literally)
o Semtek says 41(b) means P cant refile same claim
in the same fed. D. ct that entered judgment of
dismissal
Both Case 1 and 2 must be on the same Claim:
o Two cases involve same operative facts, transaction or occurrence,
basica factual situation, single core of operative facts, defendant
wrongdoing, etc. Transactional test.
o Restatement: Claim encompasses all rights to relief with respect to
all or any part of the transaction, or series of connected transactions,
out of which the action arose.
Issue Preclusion:
Requirements:
o Same issues
o Litigated and
o Actually decided on matter was necessary to judgment
Case 1 must have ended in valid final judgment on merits (Like CP)
Same issue presented in Case 2 must have been litigated and determined in
Case 1
o Default judgments dont count, Summary Judgments do.
o Same Issue:
18

 Substantial overlap between evidence/argument to be advanced

in both Case 1 and 2?
Same rule of law being used?
Pretrial prep and discovery likely embraced matter sought to be
brought in Case 2?
Issue must have been essential to Judgment in Case 1
o If the finding on this issue had come out the other way, would the
judgment be different?
Alternative theories, both sufficient, neither is precluded (R2d)
As matter of due process, issue preclusion can only be asserted against one
who was party to Case 1 or in privity with a party to Case 1.
o Unlike claim preclusion, both parties need not be same.
o One the party that issue preclusion is being asserted against must have
been a party to the case
And had full and fair opportunity to litigate in case 1
Court in case 2 must assess mutuality, who can assert issue preclusion
o If invited to join, knew about the suit and could have intervened as
matter of right, plaintiff may not be able to use issue preclusion
o Or if its not fair to use IP against defendant, like the first case was for
small amount and not really worth litigating, or procedural
disadvantages
o Or inconsistent prior judgments
When IP works and when it doesnt:
o Nonmutual Offensive IP WORKS:
Case 1:
P1
v.
D1 (loses)
Case 2:
P2
v.
D1
(can use preclusion to prevent relitigation of issue D1
lost on in Case 1 subject to certain conditions)
o Nonmutual Defensive IP DOES NOT WORK:
Case 1:
P1
v.
D1 (wins)
Case 2:
P2
v.
D1
(cannot use preclusion to prevent relitigation of issue
D1 won in Case 1 against new plaintiff)
Supplemental JUX:
Comes into play after P files claim that satisfies basis of federal SMJ
(diversity or Federal Question JUX).

19

o Additional Claim forms part of the same case or controversy as the

claim with original Fed. JUX.
Additional claim arise out of same transaction/occurrence?
o 1367(a) grants federal courts supp. JUX over the claim
BUT:
1367(b): applies ONLY to those claims brought in
federal court solely b/c of Diversity
1367(c): Court may decline to exercise supp. Jux.
o Novel question of law, state claim predominates,
etc.
Permissive Joinder:
FRCP Rule 20:
o Plaintiffs may join in one action if:
They assert right to relief jointly, severaly, or in alternative w/
respect to same TOO, AND
Any question of law/fact common to all plaintiffs
o Defendants may join in one action if:
Any right to relief is asserted against them jointly, severally, or
in alternative w/ respect to same TOO, AND
Any question of law/fact common to all defendants
Joinder is not allowed when different transactions/occurrences are involed or
when the matters do not share any legal or factual issues
ALI Note on Permissive Joinder:
o Joinder generally sought only in relatively small scale suits b/c each
new party must be joined separately and is expected to appear
personally in the action.
Large #s of parties usually use class action or something else
o Each party must satisfy JUX and Venue Requirements
o B/C permissive joinder is left to parties initiatives, presence of all
person necessary to a unitary adjudication cannot be ensured b/c some
might be left out on purpose
Compulsory Joinder:
FRCP Rule 19:
o Required party to be joined if feasible
Must not deprive court of SMJ and is subject to service of
process
In persons absence, court cant accord complete relief OR

20

 Person has interest that if not present,

Will impair/impede persons ability to protect interest
Leave another party subject to sub. risk of double/multi
or inconsistent obligations
o Where not feasible, court has much latitude to work around absence
Rule 19: Compulsory Joinder:
o Proper Parties Necessary Parties Indispensable Parties.
o People who can be in the litigation People who should be in the
litigation (desirable) People who MUST be in the party, cant
continue without them
Consolidation
FRCP Rule 42(a)
o When actions involving a common question of law or fact are pending
before the court, it may order a joint hearing or trial of any or all the
matters in issue in the action
Join for hearing or trial any or all matters at issue in the actions
Consolidate the actions
Issue any other orders to avoid unnecessary cost or delay
Trial court has broad discretion to determine if
consolidation is appropriate
Favors Judicial Economy
BUT: Convenience and Economy must not infringe on
right of fair and impartial trials.
Consider:
o Specific risks of prejudice and possible confusion
o Burden on parties, witnesses
o Available judicial resources
o Length of time required to conclude multiple suits
as against a single one
o Relative expenses compared to single trials
o Consolidation may be appropriate even where joinder is not. Where
actions are not based on the same transaction or occurrence, but DO
involve a common question of law or fact, consolidation may still be
appropriate.
1407: Multi-District Litigation (MDL)- more on that later

II.

Class Certification

Rule 23
21

(a) Prerequisites: One or more members of a class may sue or be sued as

representative parties on behalf of all members only if
1. Class is so numerous that joinder of all members is impracticable
(numerosity)
2. There questions of law/fact common to the class (commonality)
3. Claims/defenses of representative parties are typical of the class
(typicality)
4. Representative parties will fairly and adequately protect class interests
(adequacy)
Significance of Class Certification
Defining the class is of critical importance because it identifies the persons
(1) entitled to relief, (2) bound by a final judgment, and (3) entitled under
Rule 23(c)(2) to the best notice practicable in a Rule 23(b)(3) action.
o Although the identity of individual class members need not be
ascertained before class certification, the membership of the class
must be ascertainable.
A class may be defined to include individuals who may not
become part of the class until later. Such future claimants are
primarily a feature of those mass tort actions involving latent
injury.
The court should also consider whether the class definition
captures all members necessary for efficient and fair resolution
of common questions of fact and law in a single proceeding.
If the definition fails to include a substantial number of
persons with claims similar to those of the class
members, the definition of the class may be questionable.
Significance for Plaintiff
o Determines whether they are bound to judgment or not.
One is not bound by a judgment in personam in a litigation in
which he is not designated as a party or to which he has not
been made a party by service of process
BUT: Judgment of class or representative suit, to which
some members of the class are parties, may bind members of
the class or those represented who were not made parties to it
(Hansberry v. Lee).
Members of a class not present as parties may be bound
by judgment anyway where they are adequately
represented by present parties

22

 If not adequately represented, or not part of the class,

holding them bound to judgment violates DPC.
o Class Rep must have some commonality of interest and some
protectin from conflicts of interest.
Interests should be common, though need not be strictly
identical.
Due Process Notice and an opportunity to be heard are basic
elements of adequate representation.
Significance for Defendants
o Finality and Efficiency is sought. Though generally defendant would
prefer to combat individual cases.
Concern of a blackmail settlement that is- the possibility of
liability will be so great if class-action certification is granted
that the party will almost certainly settle before any decision
could be reviewed (In re Rhone-Poulenc)
A class action is not the superior manner of proceeding
where the liability defendant stands to incur is grossly
disproportionate to any actual harm caused to the
aggrieved individual.
BUT:
Eisen Rule: We find nothing in either the language or
history of Rule 23 that gives authority to conduct a
preliminary inquiry into the merits of a suit in order to
determine whether it may be maintained as a class
action.
o In re IPO Litigation and other cases have ate away
at the Eisen Rule, though it hasnt been officially
overturned by the Supreme Court yet.
o Dukes says Eisen Rule was in dicta. Effectively
overturns it (but doesnt say as much)
While we save the heavy inquiry of merit for
later (at summary judgment), there is an
initial look.
Dukes Impact:
o Not just a pleading standard
o P must show in fact that these standards are met
(numerosity, commonality, etc.)

23

o Defendant may prefer class actions, and settlements, involving lots of

plaintiffs in order to enact other provisions (like limited fund,
bankruptcy, etc.)
D seeks finality to litigation; wants to move on.
o Rule 23(f) now allows for interlocutory review of certifications.
Appropriate when:
Class certification decision as a practical matter
terminates the litigation
Class certification raises a novel issue of law
When the district courts certification is manifestly
erroneous
Class Certification Order 23(c)(1)
o (A) Time to Issue: At an early practicable time after person sues or is
sued as a class rep, the court must determine by order whether to
certifiy action as a class action
o (B) Defining the Class; Appointing Class Counsel: An order that
certifies a class action must defie the class and the class claims, issues,
defenses, and must appoint counsel under Rule 23(g)
o (C) Altering or Amending the Order: An order that grants or denies
class cert may be altered or amended before final judgment
General Requirements of Class Certification (Rule 23(a) pre-reqs)
Relationship of Rule 23(a)(2)-(4) Requirements
o All three requirements tend to merge with one another and ask:
whether the named plaintiffs claim and the class claims are so
interrelated that the interests of the class members will be fairly and
adequately protected in their absence.
o a(2) relates class members to one another, a(3) relates class
representaive to those not there
if these arent met, then a(4) likely isnt going to be true either
Numerosity- Rule 23(a)(1):
o Seriously contested only very rarely; almost always satisfied
o Joinder must be impracticable
where would-be absent members of class can be readily joined
through Rule 19/20, no particular need for class action.
Rule 19-20 practical needs: identified by name and served w/
legal process to participate in the action
o Impracticable d/n mean impossible
If it is extremely difficult or inconvenient, that is enough
24

o No bright-line test for numerosity

Practical judgment in light of particular facts
Estimates as to size of proposed class are acceptable
But cant just be mere speculation
Commonality- Rule 23(a)(2)
Commonality/Typicality tend to merge.
o And these tend to merge with adequate representation as well (a(4)).
o All ask:
Whether named plaintiffs claim and the class claims are so
interrelated that the interests of the class members will be fairly
and adequately protected in their absence.
To paraphrase: Is the class a cohesive unit?
A(2) is written such that it demands minimal commonality.
o A single factual or legal question across the class will suffice to satisfy
a(2).
Claims must depend on common contention that is capable of classwide
resolution
o Determining its truth or falsity will resolve an issue that is central to
the validity of each one of the claims in one stroke
o What matters is not the raising of common questions, but rather the
capacity of a classwide proceeding to generate COMMON
ANSWERS apt to drive the resolution of the litigation.
Note: Mere fact that a complaint alleges racial/ethnic
discrimination d/n ensure that the party who brought the suit
will be adequate rep of class and suit may not be appropriate for
class action.
EEOC can bring enforcement action against employers
thought to have discriminated, however, w/o having to
satisfy standards of Rule 23. Public Administrative
Agency is granted more flexibility than private litigants.
o Dukes (Changing the game):
Merges a(2) requirement of minimal commonality into the b(3)
type of predominance question.
Question has to be one that leads to classwide resolution
The common question must lead to an answer that, if
substantiated, would be common to all members of the class
Specific Common Resolutions

25

 Question of whether policy would lead to common action

by the defendants. Dukes case had supervisors w/
discretion, so it would be individualized proof.
o Dukes Plaintiffs claim that their local managers
discretion over pay and promotions is exercised
disproportionately in favor of men, leading to an
unlawful disparate impact on female employees
Merely showing that WalMarts policy of discretion has
produced an overall sex-based disparity does not suffice.
Dukes Language:
o Their claims must depend upon a common contentionfor example,
the assertion of discriminatory bias on the part of the same supervisor.
That common contention, moreover, must be of such a nature that it is
capable of class-wide resolutionwhich means that determination of
its truth or falsity will resolve an issue that is central to the validity of
each one of the claims in one stroke.
o Dukes I Dissent:
Evidence demonstared that claims would necessitates
examination of particular policies and practices alleged to
affect, adversely and globably, women employeed at Wal-Mart.
Rule 23(a)(2), setting a necessary but not a sufficient criterion
for class-action certification, demands nothing further
Rule 23(a)(2) DISSENTING VIEW
o Rule does not requires all questions of law or fact
raised in the litigation be common
o Single question common to all members will
satisfy the requirement
o Question must be common to the class, and
must be a dispute, either of fact or of law, the
resolution of which will advance the determination
of the class members claims.
Typicality- Rule 23(a)(3)
A class representative must be part of the class and represent the same
interest and suffer the same injury as the class members
Adequate Representation- Rule 23(a)(4)
Representative Parties will fairly and adequately protect the interests of the
class
o In may cases, merges with the typicality requirement
26

o Interclass conflicts can create typicality problems- the representative

parties may want different things out of the litigation than parties not
represented
EX: Amchem: Future plaintiffs were sold out in favor of
currently injured individuals. Found as inadequate
representation.
o Combine 23(e) fairness analysis with 23(a)(4) adequacy when
settlement is proposed

What courts look for in determining adequacy:

o Some degree of competence (Black v. Rhone-Poulenc)
o Honesty and Good Character (Kaplan v. Pomerantz)
o Absence of conflicts of interest (Robin v. Doctors Officenters Corp.)
o Ability and Willingness to finance the lawsuit, though this is less
important today with contingency fees, etc. (Weber v. Goodman)
Intra-Class Conflicts (Goes along with the above prerequisites, mostly adequacy)
Objectors- Rule 23(e)(5):
o Any class member may object to the proposal if it require court
approval under this subdivision.
Or object to attorneys fees (Rule 23(h)
Settlement Class: Class certified for settlement only. Plaintiffs file complain
and motion for certification and propsed settlement simultaneously
o Settlement terms requirements:
Common Issues Predominate
Adequate Representation by named members
Divergent intra-class interests sufficiently represented
Appropriate Subclassing
Adequate Funding
Bound known claimants with adequate notice
o Benefits of Settlement Class:
Reduce Transaction Costs
Defendant keeps reputation, plaintiff need not publicly disclose
harm to himself/herself
Mass Torts:
No concern of manageability and conflicts of law issues
that would otherwise impede certification
Common among securities and antitrust cases.
27

o Difficulties:
Judges forced to act as inquisitors (unfamiliar role)
Risk of collusion is high. Plaintiffs attorney has incentive to
bind claimants to get fees
Though manageability not an issue for settlement classes,
Court cannot ignore procedural protections of class
through 23(a) and (b).
o NOTES:
Many courts just to check the box analysis for settlement
class actions- very little in the way of factual findings.
Redish & Constinick (Arguments AGAINST Settlement Class
Actions):
Adversity is lacking, which is necessary in litigation, as
defined by Article III
o Thus settlement classes are inherently
unconstitutional
These cases are essentially ADR, or contracts, and this
isnt the courts role/purpose and isnt what it should be
engaged in.
Subclassing Problems
Class cohesiveness questions: Which fissures within the class call for
subclassing?
o Amchem: Class divided between holders of present and future claims
requires division into homogeneous cublcasses
With separate representation to eliminate conflict interests of
counsel
Ortiz says you cant have tons or ridiculous subclasses, but its
still very open ended.
o Temporal Perspective:
Choice of Temporal Perspective:
o Ex Post:
Determining whether the class was adequately represented after
the fact (Stephenson v. Dow Chemical Co.)
The ex post perspective is backward looking. From the
ex post point of view, we ask questions like: Who acted
badly and who acted well? Whose rights were violated?
o Deontological approaches to moral theory. Legal
Formalism
28

o Ex Ante:
Determining whether the class is adequate prospectively- dont
know in which group the class rep is going to be in, so theyre
okay for both (Uhl v. TTT Inc.)
The ex ante perspective is forward looking. From this
pov we ask What affect will this rule have on the future?
Will decision of a case in this way produce good or bad
consequences?
o Consequentialist, utilitarian or welfarist theory.
Legal Realism.
23(b)(3) Opt- Out Classes
Questions of law or fact PREDOMINATE over any questions affecting only
individual class members
Class action is SUPERIOR to other available methods for fairly and
efficiently adjudicating the controversy
o Considerations in determining Predominance and Superiority
(consider ALL):
1. Class members interests in individually controlling the suit in
separate actions
Negative Value Suit. Low damages make individual
litigation cost-prohibitive, w/o the class suit, individual
adjudication probably wouldnt proceed
2. Extent and nature of any litigation concerning the controversy
already begun by or against class members
Generally:
o If there is substantial ongoing litigation, it shows
folks think individual efforts are superior
o Court should take account of which court is in best
position to adjudicate all the claims
o If court cant prevent multiple adjudications, it
may decide that cert. d/n accomplish efficiency
and fairness
o If named Ps are in parallel litigation, court may
have to assess the potential positive and negative
aspects of the circumstances
3. Desirability of concentrating the litigation of the claims in the
particular forum

29

 Forum non conveniens analysis

Economies of time, effort and expense of litigants and
court
Negative value suit
Forum has already handled preliminary matters and put
in significant effort
4. Likely difficulties in managing a class action
(MANAGEABILITY)
Management d/n have to be easy, it just has tobe better
than the other options.
Prerequirements:
A potential class member of a b(3) class must be provided with minimal
procedural due process protection:
o Must receive notice of litigation
Notice must be the best practicable- reasonably calculated,
under all the circumstances, to apprise interested parties of the
pendency of the action and afford them an opportunity to
present their objections.
Notice should describe action and plaintiffs rights
Opportunity to remove self from class by opting out
o Have opportunity to be heard and participate in the litigation (in
person or through counsel)
Shutts:
Where P has claim for money damages or similar relief
at law there must be:
o Notice reasonably calculated to apprise him of the
pendency of the suit
o An opportunity to be ehard and participate in the
litigation
o Opportunity to opt-out
o Notice Cases (what qualifies as sufficient):
Peters v. National RR Passenger Co. (sufficient even though
omitted class members apartment number and used incorrect
zip code)
VMS Ltd. PShip Sec. Litig. (sufficient when mailed to former
address, even though contended they knew of new address)
Silber v. Mabon (sufficient although brokerage firm delayed
maily notice until AFTER expiration of opt-out deadline).
30

 RULE: Sufficiency of notice is a very low standard.

In reality, nobody really has an incentive to make sure
plaintiffs get notice.
o Judge wants clear docket, Plaintiffs counsel gets
paid regardless and more members=more work,
defendant has no duties to class members
o Watch for COLLUSIVE PRACTICES. Defense
and Plaintiffs counsel likely know each othertravel in small circles.
Personal JUX for 23(b)(3):
o In rem, quasi in rem, im personam
23(c)(2) NOTICE to Class Members:
o For 23(b)(1) and (2) classes:
Court MAY direct appropriate notice to the class
o For 23(b)(3):
MUST direct to class members the best notice that is
practicable under the circumstances, including individual notice
to all members who can be identified through reasonable effort.
Must state nature of action, definition of class, etc. (see
23(c)(2)(B)(i-vii)
Klay v. Humana:
o Nationwide RICO Class action against HMOs for under billing
practices.
Raises RICO Federal claims and state contract claims.
The proof of pattern is the substantive violation.
Racketeering activity cant be proven on an individual
basis.
Need an overarching policy or scheme.
Mail fraud is gravamen it is different than Avis Rent-A-Car and
Motel 6 claims.
o Court certifies federal RICO claims.
Nationwide conspiracy to restrain trade and underpay doctors is
gravamen of case and involves common questions of fact and
law; discrimination cases tangentially involved corporate
policies, but not sufficient for predominance.
Reliance must be proven for each plaintiff, but can be proved
with common evidence. Note: Civil RICO claims no longer
require reliance.
31

 Damages individualized, but can propose substantial method

for calculating damages. Individualized damages only bar to
predominance if there is no formula for determining individual
damages.
o Rejects certification of state law contracts claims.
No common questions of fact, even though state law is
essentially same with respect to the definition of breach.
While conspiracy is sufficient to prove RICO claims, contract
claims require each doctor to prove a breach of contract which
was done in different ways.
o Superiority: Must show class action is superior to joinder,
consolidation, transfer and consolidation, & individual trials. Factors:
(a): class members interest in controlling prosecution or
defense of separate actions:
Court finds no particular interest in controlling litigation.
(b)Extent nature of any litigation concerning the action has
already begun.
Substantial ongoing litigation, may show people think
individual efforts are superior. None in this case.
(c): Desirability in placing case in a single forum.
Otherwise 600k independent cases: Many doctors will
not file cases.
Class offers significant economies of time, scale, and
effort.
District court already familiar with case; handled
preliminary matters.
Immature tort doesnt counsel against placing claims in a
single forum.
(d) Difficulties in managing a class action.
Measuring whether class action is less manageable than
alternative vehicles, not whether it will be difficult to
manage.
If common issues predominate, individual cases rarely be
more manageable than a single class.
Manageability (23(b)(3)(D):
Strategic Devices for Alleviating Manageability Problems:
o Subclassing and trial of subclass issues separately
o Bifurcating liability and damages
32

o Devising an objective formula for determining individual damages

o Using 23(d) to issue orders preventing undue repetition or
complication in the presentation of evidence or argument
o Appointing special master for difficult evidentiary matters
o Using litigation committees or surrogates to receive claims and proof
of eligibility for individual damages
o Bellwether trials (trying certain issues first in anticipation of
furthering settlement
o Limited class certification under 23(c)(4) (Issue Classes)
o Power under 23(d) to require plaintiffs to bring in additional class reps
Where a court has already found that common issues
predominate, it is hard to conclude that a class action will be
less manageable than individual actions (Klay v. Humana)

In re Air Transport Antitrust Litigation:

o To be superior to other form, court must find the difficulties in
manageability will not render the actin improper for cerification
Difficulties in management are of significance only if they
make the class action a less fair and efficient method of
adjudication than other available techniques
Here, it is the only fair way, since the claims are too
small individually
o Notice concerns are not prohibitive of the action, since they just have
to be reasonable efforts, not individual notice.
Where names and addresses are known, individual notice is
required.
o Time-consuming and tedious is not unmanageable if the calculation is
mechanical and repetitive.
Complex and difficult does not mean unmanageable
Hilao v. Estate of Marcos:
o Special Master used statistics to determine representative sample of
137 claims would be an accurate portrayal of the whole class as to
type of suit brought (torture, summary execution, disappearance of
others) and the percentage that were valid.
Procedure found to be an accurate prediction, but increases
likelihood of paying wrongful claim.

33

 Risk of erroneous payment outweighed by plaintiff interest in

receiving compensation. W/O using statistics, determining
liability would be impossible.
State interest of getting this case over and done with.
Matthew v. Eldridige (Marcos cites to say statistics use
okay)
o Used for determining whether a procedure by
which a private party invokes state power to
deprive another person of property satisfies due
process:
Consideration of private interest;
Risk of erroneous deprivation.
Principal attention to interest of party
seeking procedure with due regard for an
ancillary interest the government might
have.
Common Questions (Issue Classes):
o It is possible to certify the class for only the common questions. Once
the common questions have been answered in class format, individual
trials can determine injury, causation, etc.
CHOICE OF LAW (biggest issue in manageability analysis)
Under Erie Doctrine, federal courts in diversity actions must apply the
choice of law rules of the state in which the court sits.
o Thus, in a nationwide class, there could be up to 51 sources of law
governing the claim (where the courts COL rules require the court to
apply the law of the place of injury, for instance).
This task has led to some courts finding that the different laws
make individual issues predominate over common ones, and
thus defeat a class b(3) certification.
o Court in multi-Jux 23(b)(3) class action cannot resolve choice of law
determinations by summarily concluding that one states law should
apply to all class members
o Cole v. GMC: If multiple states laws apply and those laws vary, the
variations may impact whether common issues of law and fact
predominate among the class members
COL Analysis proceeds in three basic steps:
o Identificaton of a conflict

34

 Does a conflict actually exist among the bodies of law with

potential application to the dispute?
False Conflict: No real discrepencies among the sources
of law
True Conflict: Real differences. Requires choice of law
principles that govern resolution and requires choice of
substantive law by court.
Due process violation arises at this stage (is there a conflict)
occurs only when the courts construction of another states law
contradicts the law of the other state.
Just simply misconstruing the law is not enough to be a
violation (Sun Oil case)
o Identification of the applicable choice-of-law principles
True Conflict: Real differences. Requires choice of law
principles that govern resolution and requires choice of
substantive law by court.
Where state court- look at state law as source of choice of
law standard (but remember CAFA will likely put the
case in Fed anyway)
Because of Erie, Fed look at state in which it sits state
law as well.
o Application of those principles.
THREE MAIN TESTS STATES USE TO DETERMINE
WHICH STATES LAW GOVERNS
Vested Rights Test (1st Restatement):
o Determine when and where a particular right
vested, because the law in place where the right
vested would control the content of the right
o Torts: place of injury.
o Contracts/Property: place of making the contract
Criticized for sometimes applying a states
law that did not have a real interest in the
litigation
Significant Relationship Test (2nd Restatement )
o Courts should apply law of the state with the most
significant contacts with the case
Factors:
Place where injury occurred
35

 Placed where conduct occurred

Domicile, residence, incorporation of
parties
Place where relationship of parties is
centered (if any)
Policies of the selected forum and the
justified expectations of the parties
Interest Analysis Test:
o Applies the states law that has the most interest in
see its law applied. Generally the law of the forum
state, unless some other states policies would be
impeded by not applying that states substantive
law

Bifurcation:
o The court might have an overall determination of facts applicable to
everyone and then then, if successful, the court might divide the group
into subclasses based on different substantive applicable laws.
EX: Class action for tort claim successful, but plaintiffs want
punitive damages. Punitive damages are different standars
among all the applicable state laws. Court could divide into
subclasses after general actionability and wrong-doing is
established.
Medical Monitoring:
Courts have split on what to do with these claims and have certified them
under a number of rules based on different theories:
o 23(b)(1)(A): Separate adjudications would impair plaintiffs ability to
pursue single uniform medical monitoring program
o 23(b)(a)(B): might be dispositive of the interests of the other members
not parties to the adjudication, or substantially impair/impede their
ability to protect that interest
o 23(b)(2): medical monitoring really constitutes injunctive relief
o ALL ABOVE DISFAVORED!
23(b)(3): Funds distributed for individualized medical
monitoring are essentially damages and thus should be handled
under (b)(3).
THIS IS THE SUPERIOR METHOD
23(b)(1)-(2) Mandatory Classes
Used for indivisible remedies
36

o Divisible Remedies: those that entail distribution to one or more

claimants individually, w/o predetermining the application of the same
remedy to any other claimant in practical effect
o INDIVISIBLE REMEDIES:
Those where the distribution of the remedy to any claimant
invariably affects the application of the same remedy to other
claimants
(b)(1)(A) Prejudice Class Action: Mandatory Class when prosecution of
separate actions by or against individual class members would create a risk
of inconsistent or varying adjudications with respect to individual class
members that would establish incompatible standards of conduct for the
party opposing the class
o Similar to Rule 19s prejudice standard
o EX: individual suits would subject defendant to incompatible
standards of conduct
NOT appropriate where primary objective is monetary damages
o Test:
Court asks if the putative class members sue individually,
might it subject the defendant to incompatible standards of
conduct?
(b)(1)(B) Separate actions would create a risk of adjudications with respect
to individual class members that, as a practical matter, would be dispositive
of the interests of the other members
o claims may be dispositive of other interest, may impede ability to
protect those other interests or if there is a limited fund.
Adjudication as to one or more members of the class will
necessarily or probably have an adverse practical effect on the
interests of other members who should therefore be represented
in the lawsuit
EX: Limited Fund Cases
o Other members of the class, their claims practically concluded, have
no representation in the lawsuit
EX: action charging breach of trust by a beneficiary similarly
affecting the members of a large class of security holders or
other beneficiaries.
23(b)(2) for Equitable Relief Only
o Prerequisites of 23(a) are satisfied AND

37

o Party opposing the class, usually the defendant, has acted or refused to
act on grounds generally applicable to the class thereby making
appropriate final injunctive relief with respect to the class as a whole
Generally for equitable relief, monetary damages essentially
barred.
Injunctive, Declaratory Relief, Restitution
No predominance or superiority requirements, but the
class claims must be cohesive (and remember Dukes has
raised the pleading standard of commonality as a pre-req)
o The members of a (b)(2) class are generally bound
together through preexisting or continuing legal
relatoinsihps or by some significant common trait
such as race or gener (Barnes fn. 18)
o Money damages are not allowed as a significant objective in a 23(b)
(2) class
Ostensibly allowed damages under (b)(2):
Flow automatically from the injunction
Easily calculated
(b)(2) certification is proper if primary objective is to obtain
injunctive relief
Money damages dominant when their presences suggest
that procedural safeguards
As punitive damages and compensatory damages require
individualized hearings on independent factual issues, they are
inappropriate for a (b)(2)
Punitive damages are now tied to compensatory
damages- therefore cannot be done as a class if
compensatory damages are individualized.
They may make individualized claims more
economically viable anyway, so as to mitigate the need
for a class action
o HYBRID:
Certify the injunctive relief under 23(b)(2) and then do the
money damages under 23(b)(3)
Allison v. Citgo rejected this possibility, but it may be
considered by other courts.
23(b)(1)(B) Limited Fund Classes

38

o Class may be certified if claims may be dispositive of other interests,

and may impede ability to protect those interests or if there is a
limited fund
o Ortiz Standard for Limited Fund:
1. Parties must demonstrate, not merely assert, that available
funds are insufficient to cover the numerous claims
Substantial probability that if damages are awarded, early
claims will exhaust assets, resulting in bankruptcy, thus
not allowing later claimants to recover
There must be a substantial probability that the claimants,
if fully satisfied, would completely exhaust the assets of
the company
o How to figure out if they will likely exhaust the
funds:
Look at settlements regarding type of claim
if not confidential
Have bellwether trials
Determine, through independent analysis,
net worth of company (and insurance funds,
etc.)
2. Proposed distribution must be equitable
Cannot discriminate against some class members
o For classes that consists of those with existing
injuries and those whose injuries have not
developed yet, ensuring equitable distribution of
the proceeds would be a serious problem.
3. Defendant must be significantly impaired by the limited fund
o Ortiz fund failed b/c:
No determined size of fund
No analysis that fund was actually comprised
No independent evaluation of potential insurance funds
Excluded inventory plaintiffs, and plaintiffs with ongoing
litigation in favor of future plaintiffs
Intra class conflicts without adequate rep
No due process protections
o Created limited fund out of thin air- not actually
a limited fund as Fibreboard was to remain viable
company
39

o There has to be a pre-existing fund, you cant use 23(b)(1)(B) for a

made up trust fund or something- to artificially limit the fund.
Punitive Limited Funds:
o Not allowed Under Simon II Litigation
o A limited punishment fund was proposed under the idea that the early
plaintiffs would get the largest punitive damage awards, and then the
courts would decide theyd been punished enough, and later plaintiffs
would receive less
Thus, a proposed fund would allow each plaintiff to get a piece,
and punish the defendant just the one time
o REJECTED THEORY!
Fund in this scenario is unascertainable and undefined.
The fund here is postulated, and for that reason is not
susceptible to proof, definition or even estimation by any
precise figure
And punitive damages are necessarily linked to
compensatory damages- which arent measured here.
Issue Classes
Reexamination Clause
o 7th Amendment: No fact tried by jury shall be otherwise reexamined
in Court
Note: If a general verdict is reached, it may be difficult to
determine what issues where actually decided- there could be
different ways juries reached it.
Today, special jury verdict forms are structured in terms of
specific questions keyed to the applicable legal elements:
Example: Do you find it more likely than not that the
defendant failed to take reasonable care under the
circumstances?
23(c)(4) When appropriate, an action may be brought or maintained as a
class action with respect to particular issues
o Different kinds of class actions described in (b) may be certified only
as to particular issues within a larger array of issues in a given
litigation
Examples for issue litigation:
Liability and remedies separated
Different elements of liability separated (some focus on
defendant conduct, for instance)
40

 Divisible relief and indivisible relief separated (damages

apart from injunctive relief)
Problems with Issues Classes
Constitutional Limits stemming from Reexamination
Clause (7th Amendment)
Pragmatic Issues
NOTE: Relook at Nassau! May have a bad reading on what is allowable and
what isnt!
Predominance and Issue Classes (Subclassification using (c)(5):
o (2d Circuit) An issue class certification is allowable regardless of
whether claim as a whole satisfies predominance test. (Nassau
County)
Requiring such would defeat the purpose of an issue class.
Courts may separate out limited issues under (c)(4) and then
conduct the Rule 23(a) and (b) inquiries.
o (4th Circuit) Salovaara: consider 23(a) and (b) in light of ability to
certify issues classes because to do otherwise would require court
considering manageability to ignore the ability to make the class more
manageable through (c)(5); could only use (c)(5) to make manageable
classes that were already deemed manageable
o (5th Circuit) Castano: cause of action as a whole must satisfy the
predominance requirement of (b)(3); (c)(5) is a housekeeping rule that
allows courts to then sever common issues for trial
o (9th Circuit) Gunnels and Valentino: courts may isolate common
issues under 23(c)(5) and proceed with class treatment of those
particular issues even if the predominance requirement isnt met
o (11th Circuit- Georgia) Use (c)(5) before conducting predominance
inquiry under (b)(3).
Separation of Mandatory and Opt-Out Classes
o Indivisible and divisible relief may be separated without violating the
7th Amendments reexamination clause (International Truck)
Jury will hear first case on defendants conduct and make
decision as to injunctive/indivisible relief
Issue preclusion may be used for later trials as to the conduct
determined by the trier of fact in that original tiral
o May determine the (b)(2) class action issue, then allow members to
opt out of (b)(3) damages class or prevent issue preclusion from
denying them their right to jury trial
41

 International Truck situation:

Different isssues of discriminatory policy (indivisible
relief sought) and instances of discrimination (divisible
relief, damages sought)
o (b)(2) goes first
23(b)(5) Subclasses: When appropriate, a class may be divided into
subclasses that are each treated as a class under Rule 23.
Eisen Rule and Parameters of Judicial Inquiry for all Class Actions
From Manual on Complex Litigation:
o Discovery into certification issues pertains to requirements of Rule 23
and tests whether claims/defenses are susceptible to class-wide proof
o Discovery into merits pertains to strengths/weakness of
claims/defenses and tests whether they are likely to succeed
Not always a bright line between the two
Insistence on separation is arbitrary and thwarts assessment that
current class certification practice emphasizes
Eisen Rule: We find nothing in either the language or history of Rule 23
that gives authority to conduct a preliminary inquiry into the merits of a suit
in order to determine whether it may be maintained as a class action.
o In re IPO Litigation and other cases have ate away at the Eisen Rule,
though it hasnt been officially overturned by the Supreme Court yet.
o Dukes says Eisen Rule was in dicta. Effectively overturns it (but
doesnt say as much)
While we save the heavy inquiry of merit for later (at summary
judgment), there is an initial look.
o Dukes Impact:
Not just a pleading standard
P must show in fact that these standards are met
(numerosity, commonality, etc.)

In re IPO Securities Litigation (2d Cir. 2006):

o Securities class actions alleging fraudulent IPO issuance policies by major
underwriters.
o Court must resolve factual issues relevant to Rule 23 requirements even if they
overlap with merits.
Some showing insufficient. Have to have a definitive assessment.
o Expert testimony must be evaluated to ensure reliability and whether it supports
Rule 23 requirements.
o Securities class actions have protections against frivolous claims. Only 4 have
ever been found frivolous.

42

III. The Class Action Fairness Act (CAFA)

Goal:
o Get more class actions involving state law claims
Expands federal court JUX over state-law class actions.
o 1332(d): Plaintiff may initially file in Federal Court OR Any
Defendant may remove (per 1446) to federal court even if the other
defendants dont join in removal:
minimum diversity required:
any member of a plaintiff class is a citizen of a state
different from any defendant
any member of a plaintiff class is an alien and any
defendant a citizen of a state
any plaintiff class member is a citizen of a state and a
defendant is an alien
Amount in Controversy:
In aggregate, class seeks $5 Million +
EXCEPTIONS:
Local Controversy:
o 2/3 of class claimants and primary defendants are
citizens of state in which action was originally
filed
Not sure what primary means
Home State:
o Greater than 1/3, but less than 2/3 of the class
claimants and primary defendants are citizens of
forum state, court MAY decline JUX, but look at
totality of circumstances
No helpful standard as to how the factors
weigh on this evaluation
o Notes on CAFAs procedure:
CAFA removed one year time limit (in general, you cannot
remove a case if it becomes removable after 1 year)
CAFA allows defendant to remove even if sued in their home
state
Consent of all defendants to remove is not required
CAFA D/N affect Choice of Law Questions
Still apply the standard of the state in which court sits
43

o Mass Actions
Defendant may remove Mass Actions to federal court (not just
class actions)
Civil actions in which 100+ claimants are joined
Each plaintiff must meet the $75K+ AIC requirement
o D/N Include Cases where:
Claims arise in filing state and injuries were
suffered in that state or contiguous state
Defendant joined the claims
Claims are asserted on behalf of public
pursuant to state statute
Claims have been consolidated solely for
pretrial proceeding
o If defendant removes Mass Action, no MDL
treatment unless majority of plaintiffs request it
Once everything is in same forum, can move to
consolidate cases
Transfer per 1404, 1406 and consolidate under Rule 42
We still have overlapping class actions after CAFA.
o There are exceptions to CAFA, there may not be complete diversity,
etc.
o Defendant may also want to stay in state court.
Defendant could see whether there are multiple cases going on
and decide where theyd rather be. They can effectively shop
around for the best forum
Multidistrict Litigation Act (MDL)
Created Judicial Panel on Multidistrict Litigation (MDL Panel)
o Coordinates related lawsuits within Federal Judicial System
o Rule:
When civil actions involving one or more common questions of
fact are pending in different districts, such actions may be
transferred to any district for coordinated and consolidated
pretrial proceedings
o Requirements for Transfer:
Civil Actions involve one or more common questions of fact
Pending in different districts
Convenience of parties and witnesses recognized

44

 Promotes just and efficient conduct in such actions

o May be initiated by:
MDL panel upon its own initiative
Motion filed with the panel by a party in any action in which
transfer may be appropriate (defendant or plaintiff)
MDL 1407
o Panel Actions
Decides when/where to transfer cases in federal district courts
Can act sua sponte (on its own) or by motion of party
Cannot try cases (Lexecon)- Transfer is for pretrial purposes
only
Discovery, certification, summary judgment, pre-trial
filings and preparation
ALMOST ALWAYS SETTLED AND NOT SENT
BACK (DeLaventura)
o Litigant who refuses to settle will not get sent back
to home court
o May unfairly advantage defendant to force
settlement
Can Consolidate multiple class actions under MDL
o Getting around Lexecon and inability to try the case:
Intra/Inter circuit transfer per 292, 293 and get assigned to
original district
Get complaint dismissed and refilled in transferee court
Perform non-precedental bellwether trial (affects/encourages
settlement)
o Laws applied
Van Dusen Doctrine: Transferee Court must apply the same
state law, including Choice of Law standards, as would have
been applied in transferor court.
Makes Choice of Law in transferor court very complicated
BUT: Transferee court can apply its own view of federal law
NOTE: No class action removed to federal court under CAFA provisions
shall thereafter be transferred to another district per MDL w/o request of a
majority of plaintiffs
o D/N apply to those originally filed in Federal Court b/c of CAFA

45

o Dont want to double advantage defendants to remove, then transfer to

force settlement.
IV. Coordination across Different Judicial Systems
FFCC: Judicial proceedings of any state shall have the same full faith and
credit in every court within the US as they have by law or usage in the courts
of such State form which they are taken.
o Directs all JU to treat a state court judgment with the same respect
that it would receive in the courts of the rendering state.
FFCA: Federal Courts give state court judgments same effects in federal
courts that judgments would be given in state courts
o Federal Court must give a state-court judgment approving a class
action settlement which releases claim within the exclusive
jurisdiction of the federal court the same effect that it would have in
the courts of the state in which it was rendered (Matsushita)
Framework for deciding whether a state court judgment can
preclude an exclusively federal claim:
Does the law of the state rendering the judgment indicate
that the particular claim or issue would be barred from
litigation in a court of that state?
If so, as an exception to the FFCC, should the federal
court refuse to give preclusive effect to the state court
judgment?
o Express indication in statute w/ exclusive federal
JUX that discusses it relationship w/ FFCA or
preclusive effect of related state court
proceedings? (RARE)
o Do concerns underlying a particular grant of
exclusive JUX justify a finding of an implied
partial repeal of the FFCA?
Congressional Intent is primary
consideration
Federal Courts Preclusive Effect on State Proceedings:
o 2283: fed court may not grant an injunction to stay proceedings in
state court unless
as expressly authorized by congress
where in necessary aid of the fed. Courts JUX
to protect or effectuate fed judgments (relitigation exception)

46

 use All Writs Act (28 USC 1651) to provide the positive
authority for fed courts to issue injunctions of state court
proceedings
o Smith v. Bayer (Issue Preclusion, Relitigation Exception):
First, the issue presented in the state court was not identical to
the one decided in the federal tribunal.
And second, the plaintiff in the state court did not have the
requisite connection to the federal suit to be bound by the
District Courts judgment.
Issue Preclusion:
o Valid Final Judgment on the merits
o Same issue in Case 2 as Case 1 (not just similar
facts, this is where Bayer fails)
o Issue must be essential to judgment
o IP can only be asserted against one who was party
to Case 1, or in privity (also lacking in Bayer)
Types of Relationships that Bind NON-Parties:
o Successive Interests in Property (in priviy)
o Nonparty controls litigation in Case 1 (somehow
manages conduct of litigation, has direct
financial/proprietary interest in litigation)
o Nonparty represented by party in Case 1
Class action, fiduciary action, etc.
Anti-Suit Injunction Act and All-Writs Act
2283: Federal Court may not grant an injunction upon state court
proceedings UNLESS
o (1) Expressly Authorized by Congress
o (2) Where in necessary aid of the Federal Courts JUX
State case removed to federal court and state court refuses to
relinquish JUX
And where a fed court first acquires JUX ofver a case involving
the dispositin of real property
If Fed. Ct. has JUX in Rem or quasi in rem, they can
enjoin other courts from hearing cases from hearing the
matter.
D/N apply to in personam JUX
Need res in form of limited fund or be very close to final
judgment (imminent) (In re Eagle-Picher)
47

o (3) To protect of effectuate a final judgment on the merits (relitigaiton

exception)
Permits federal courts to enjoin state proceedings if necessary
to ensure preclusive effect of earlier fed. ct. decision
(traditionally) Must have final judgment on the merits
Smith v. Bayer
Corrugated Container Litigation
o IF any injunction fall under one of these exceptions, the All Writs Act
(1651) provides positive authority for federal courts to order an
injunction of the state proceeding.
Rooker-Feldman Doctrine:
Limits JUX of Fed. District Cts to review final
adjudications of state courts
o Once state court enters judgment, D. Ct. lack SMJ
over those claims
o Thus, there may be need for injunction
CASE LAW (Examples of exceptions and their application)
o In re Corrugated Container Antitrust Litigation (5th Cir. 1981):
Federal MDL class action alleging antitrust conspiracy; plaintiffs counsel
files competing class action in state courts. State court raises only state
antitrust claims. District court enjoins state proceedings.

5th Cir. finds that injunction was proper under Necessary in aid of
jurisdiction exception: South Carolina will challenge federal jurisdiction
by impeding the progress of federal case.
Protection of Judgment: Cases have settled; injunction necessary to
protect imminent final judgment.
No final judgment in South Carolina. Final judgment is imminent
in the federal case.
GM Trucks only got to certification. Here S.C. may impede federal case,
undercut likelihood of settlement.
o In re Joint East. & So. District Asbestos Litig. (In re Eagle-Picher Industries)
(E.D.N.Y. 1990):
Asbestos limited fund class action conditionally certified; moves to enjoin
ongoing state proceedings.
Judge Weinstein enjoins all ongoing state litigation under necessary in aid
of jurisdiction exemption:
Necessary because continued litigation threatens fund, over which
court has jurisdiction, making it difficult to negotiate equitable
settlement in limited fund cases. Prevents depletion of fund.
o Also worried about inconsistent judgments.

48

Interest in a class action is similar to a res; can issue injunction to

protect individual class members interests; cannot have
simultaneous jurisdiction over same property.
o Assets held in a common fund, held to be distributed
equitably among class.
Limited fund similar to interpleader, have to recover against fund
or not at all.
o Fighting over limited fund of assets. Zero sum game.
Settlement is immiment: Judge is cracking down on the parties.
o Carlough v. Amchem Products (3d Cir. 1993):
Federal settlement class action filed. Objector files West Virginia class
action request declaration that federal class settlement is unenforceable
and not entitled to full faith and credit in West Virginia for futures
claimants. Also requests judicial declaration of opt for W.Va. futures
claimants.
Attempts to be declared adequate representative of W.Va. class.
District Court enjoins state case under Necessary Aid of Jurisdiction.
Settlement is imminent.
This directly challenges propriety of the federal class, disruptive to
settlement proceedings
Also problem that plaintiffs will be confused as to which class they
belong.

Dueling Class Actions Synopsis:

o Are the different classes in state and federal court?
If two states, states cant enjoin other states
State courts generally cant enjoin federal courts
o If state court has entered final judgment, then fed. ct must afford that
judgment full faith and credit and it lacks JUX to act as an appellate
court (review the state courts decision) b/c of rooker-feldman
doctrine
True even if state ct. includes exclusively federal claims in
settlement, so long as that state would preclude subsequent relitigation under its own state laws (Epstein I)
Only potential route around this is possibly state court violated
Due Process right and judgment should be afforded full faith
and credit (Ginsberg, Epstein I)
o If the state ct. hasnt entered a final judgment, then what is the status
of the Federal ct. litigation?
Class Certification denied: Federal Cout shouldnt interfere
Smith v. Bayer, GM Pick-up Truck

49

 Final Judgment Rendered: Injunction proper using protect or

effectuate exception
Nearing class settlement/prospect imminent: Injunction
proper using necessary in aid of Fed. Ct. JUX exception,
particularly if state court threatens the Fed. Ct. deal
Corrugated Container, Carlough
Nearly Certified Limited Fund: Injunction proper using In res
exception. The analogy of a res is extended to a limited fun b/c
of their magnitudge and complexity and advanced stage of
action
In re Eagle-Picher
V.
Settlements
FRCP 23(e): Settlement, Voluntary Dismissal, or Compromise.
o The claims, issues, or defenses of a certified class may be settled,
voluntarily dismissed, or compromised only with the court's approval.
The following procedures apply to a proposed settlement, voluntary
dismissal, or compromise:
(1) The court must direct notice in a reasonable manner to all class
members who would be bound by the proposal.
(2) If the proposal would bind class members, the court may
approve it only after a hearing and on finding that it is fair,
reasonable, and adequate.
(3) The parties seeking approval must file a statement identifying
any agreement made in connection with the proposal.
(4) If the class action was previously certified under Rule 23(b)(3),
the court may refuse to approve a settlement unless it affords a
new opportunity to request exclusion to individual class
members who had an earlier opportunity to request exclusion
but did not do so.
(5) Any class member may object to the proposal if it requires
court approval under this subdivision (e); the objection may be
withdrawn only with the court's approval.

CAFAs Effect on Settlement Procedures:

a. Coupon Settlements 28 U.S.C. 1712: Regulates Fee Awards: If proposed
settlement in class action provides for recovery of coupons to class members,
portion of any attorneys fee award to class counsel that is attributable to award of
coupons shall be based on value of coupons that are redeemed.
i. Waiting for attorneys fee for years provides disincentive for class action
litigation.

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b. Class action litigator acts like private attorney general. Trying to cover what
regulation cannot.
c. Settlements Resulting in Loss to Class Members: The court may approve a
proposed settlement under which any class member is obligated to pay sums to
class counsel that would result in a net loss to the class member only if the court
makes a written finding that nonmonetary benefits to the class member
substantially outweigh the monetary loss.
i. See Bank of Boston: Got $8 for class members, but class members liable
for attorneys fees.
d. Distribution Based on Geographic Location: 28 U.S.C. 1714: The court may
not approve a proposed settlement that provides for the payment of greater sums
to some class members than to others solely on the basis that the class members
are located closer geographically to the court.
e. Notice to Government Officials: 28 U.S.C. 1715(b): Not later than 10 days
after a proposed settlement of a class action is filed in court, each defendant that
is participating in the proposed settlement shall serve upon the appropriate State
official of each state in which a class member resides and the appropriate Federal
official, a notice of the proposed settlement.
i. Only happened in Wyndham.
1. Notice Must include
a. Complaint, notice of scheduled hearings, class notice,
terms of settlement and contemporaneous agreements made
between class counsel and defense counsel, any notice of
dismissal, names of the class members residing in state
officials state or reasonable estimate of number of them
and proportion of claims, and any judicial opinion relating
to these claims
f. Bull Rubensteins new mechanisms for review at the fairness hearing:
i. Devils Advocate: Court appoints devils advocate to argue against
reasonableness of settlement, recreating adversarial environment.
ii. Bonds: Parties settling must post bond w/ court; bond used to pay
objectors fees.
iii. Labels: public agency could require that class action settlements be
labeled with a simple chart
iv. Trademarks: Could register a certification mark similar to Good
Housekeeping seal of approval.
1. There is a decline in adversarial litigation. Role of the judge is
supposed to be impartial decider. Judges becoming managers of
litigation.
g. How can objectors win, if they dont have access to discovery.
i. Need to intervene if you want discovery on the issues. Dublin.
ii. Public Citizen: Left wing, nonprofit. Advocates on behalf of consumers.

At settlement:
o Judge is supposed to act as fiduciary for class at settlement and
voluntary dismissal phase (Reynolds)

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 See above for mechanisms of doing so

o Girsh factors for considering fairness or proposed settlement:
Complexity, expense and likely duration of the litigation
Reaction of the class to the settlement
The stage of the proceedings and the amount of discovery
completed
The risks of establishing liability.
Risk of establishing damages.
Risks of maintaining a class action through trial.
Ability of defendants to withstand a greater judgment.
Range of reasonableness in light of best possible recovery.
o In re Prudential Factors (in addition to Girsh!):
Maturity of underlying substantive issues.
Development of scientific knowledge
Extent of discovery on the merits
Other factors bearing on ability to assess outcome of a trial on
merits and individual damages
Existence and probably outcome of claims by other classes and
subclasses
Comparison between the results achieved by the settlement for
individual class or subclass members and the results achieved,
or likely to be achieved
Whether class or subclass members are accorded the right to
opt out o the settlement.
Whether any provisions for attorneys fees are reasonable; and
Whether the procedure for processing individual claims under
the settlement is fair and reasonable.

Objecting
o Rule 23(e)(5)- permits objections to be withdrawn only with courts
approval
o Rule 23(e)(3)- requires parties seeking approval of settlement to
identify any agreement made in connection w/ proposed settlement
Designed to foster transparency of special deals made with
those who try to hold up settlements
Devlin curtails these powers

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 Objector d/n have to have approved intervention to

appeal approval of the settlement (thus, Judge has less
control over would-be predatory objectors)
o Devlin:
Have to object to appeal the approval of the settlement, but
need not intervene
BUT:
Some JUX have limited Devlin to mandatory class
actions, only those without opt-out rights (Barnhill)
Some JUX still require formal intervention before you
can object to a final judgment (Arkansas)
Collateral Attacks on Class Settlements
o 23(e)(4)(A) Any class member may lodge objections to a proposed
settlement
o A collateral attack is a separately filed action challenging the validity
of the previous judgment instead of going through the appellate
process. Attacks validity of judgment of first court.
Alleges parties in second case are not part of the class, or that
there was not adequate representation
Usually takes the form of a dissatisfied person suing on
their own in another JUX or another class action
o Usually the class action in question will end in
state court and the dissatisfied party goes to federal
court
If it was in federal court, they cant really do
anything.
o WHAT IS ADEQUATE REPRESENTATION and HOW DOES
IT EFFECT PRECLUSION?

Three respective opinions in Epstein illustrate three different approaches

to preclusion question:
Judge OScanlon: Claim preclusion principles for collateral attacks.
If there was full and fair opportunity to raise constitutional
adequate representation issues, we should give the judgment full
faith and credit.
Judge Wiggins: Seeks to adapt issue preclusion principle for collateral
attacks.
We should be looking at whether it was fully litigated and
determined.
Was adequacy of representation fully and fairly determined.

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Judge Thomas (Dissenting): No preclusion for this particular collateral

attack, because there was no adequate representation.
The opportunity alone isnt good enough, but if they were actually
fully and fairly litigated, then that is enough to preclude the
collateral attack.
Thomas thinks they werent adequately represented and the
Delaware court didnt make any specific findings as to adequate
representation.
But claim preclusion applies to parties. Class members not afforded party
status.
Also doesnt make sense in terms of issue preclusion; Issue wasnt fully
and fairly litigated.

o THE BURCH PRECLUSION MATCH UP:

Adequate representation in structural conflicts sense: Law should use

issue preclusion principles:
Question whether rendering court, in fiduciary role, actually
determined structural conflict now being invoked by collateral
attack is not disabling to class representation.
Adequate representation in fair class settlement sense: should use claim
preclusion principles:
Question should be whether there was a full and fair opportunity
for absent class members to object to the fairness of the deal in the
rendering court.

Deterrence of Opt Outs Through Class Design

Opt Outs are not a good thing for Ps Attorneys or Defendants, and thus
provisions and schemes have been developed to prevent them from
occurring (or negating the effectiveness of those that are):
o Methods:
Settlement provisions which enjoin the use of the common
nucleus of facts in the settlement (In re Prudential)
All assets of the defendant secured by a lien held in trust in
favor of settling parties
Objectors cannot be paid until lein expired
Favored Nation- any better settlements acquired later would
automatically up the provisions of the settling class
(discourages cherry picking)
And tells plaintiffs attorneys if they do get an opt out,
their claims are going to be litigated to all hell
Walk away provisions: if we dont get some percentage
participation, no settlement

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 Prevention of opt outs from getting funds before the settling

class
o Other techniques to discourage opt-outs:
Right to withdraw clause: defendant may choose to withdraw
from class settlement if it determine that an excessive number
of class members have opted out.
Most favored nation clause: class settlement assures class
members of additional benefits in the event that comparable opt
out cases receive judgments or settlements higher in value than
the benefits described in the class settlement agreements.
o Back-end opt out rights: You have the right to opt out and pursue
claims if certain things arise, but you give up some claims to do so.
Like punitive damages. Essentially you have to buy your way out of
the class in order to pursue something on your own.
Back-end opt outs appear to cause so many complications their
costs outweigh their benefits.
NON-Class Settlements
Only applies to the people who have brought suit- class not yet certified
o As CAFA discourages nationwide classes, this type of suit more likely
o Removal of nationwide classes makes them largely unmanageable
Aggregate Settlement:
o 2 or more clients claims are resolved by same lawyer
Model Rule 1.8: to do so, need IC of each client. Disclosure to
them requires:
Total amount of aggregate settlement
Existence and nature of all claims and defenses involved
Details of every other clients participation in settlement,
their contribution and receipt
Total fees paid to lawyer and whether they will be paid
from settlement fund or ortherwise
Method by which costs are to be apportioned
o Clusters within NonClass Aggregation:
Geographic clusters/Individuals entering into litigation together
represented by single attorney
Individuals/clusters represented by different attorneys may
further cluster through cooperating attorneys OR court ordered
transfer and consolidation
Problems w/ Nonclass Aggregation:
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o Disunity arises between three factions:

Attorneys and their clients (agency problems)
Plaintiffs and other plaintiffs (group problems)
What to do with holdouts, dissenters, those who join the
group but then want to leave
What to do with outliers, those who have never joined
group or considered themselves group members
How to mitigate competition among subgroups
Plaintiffs attorneys and other plaintiffs attorneys (competition
problems)
Litigants Prefer:
o Adversarial system before impartial decision-maker w/ errorcorrecting mechanisms such as new trials and appeals
o Well-established court rules OR ability to participate in designing
dispute resolution procedures
o Opportunity to take part and be heard in process
In re Zyprexa Products Liability Litigation (E.D.N.Y. 2006) (Weinstein, J.):
o Court subverts private contracts of individually retained attorneys.
Judge says This action is more like a class action than
individual action, and Id have power to award attorneys fees
in a class action, so I should have that same authority now.
o Didnt deviate about what they contracted for. Reduced plaintiffs
fees.
o Worried about the claimants. Judge Weinstein used to represent
clients in legal aid
Tax Authority, Inc. v. Jackson Hewett, Inc. (N.J. 2006):
o All joined under Rule 20. All agreed to be represented by the same
attorney.
Same series of transactions or occurrences.
o What sort of governance agreement do they set up?
How do they decide when settlement is appropriate?
Steering committee represents 154 of individual plaintiffs.
No allegations of collusion.
o Get together, sign agreement, four different attorneys.
Have to have a bare majority to settle.
o Does it seem like an unfair allocation scheme?
Proceeds are easily calculable.
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 Why doesnt the court dispense with the aggregate settlement

rule?
o RULE:
Ex ante agreements to follow particular decisional rules short of
unanimous consent are impermissible under current law
Attorney may not obtain advance consent from his
clients to abide by the majoritys decision about the
merits of an aggregate settlement.
Arrangement which allows majority to control rights of
minority is violative of the basic tenants of the A/C
relationship
Vioxx Settlement:
o Have agreed on the terms of the proposed settlement.
o Calling it a settlement, changing the rhetoric. Not settlement until
85% walkaway provision satisfied.
Have this walkaway provision: 85% of plaintiffs have to sign
on.
o To encourage them to sign on: 100% of the attorneys recommend the
deal to their claimants.
o If youre attorney comes to you and is require to recommend it to you,
you will feel inclined to take it.
o There was a group of attorneys who filed an emergency motion.
o If we recommend it with 100% of clients, we cant fulfill their ethical
recommendations.
o Alternatives:
Had to withdraw from representing their client if they did not
take it.
Pretty much required that everyone signed on.
o Trying to enforce the settlement agreement. Creates odd incentive.
o Defendant will enforce the super majority.
o Third party beneficiary between plaintiffs attorneys and their clients.
o When do plaintiffs attorneys get paid? After settlement, by the
defendant.
Quasi-Class Actions
Basically an Aggregate settlement which occurs through MDL
The nature of a quasi-class action is virtually undefinable and it is a sort of
shotgun from the hip approach by the judge to wholistically look at litigation

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and determine whether it is so like class action that their role becomes a
fiduciary and supervisory one.
o Vioxx, Zyprexa Products
o Judge has power to reduce fees- acts as fiduciary like a certified class
action judge would
Bellwether Trials
To determine a sort of standard for what a case is worth, what payment
should be made, what the criteria for eligibility is, etc. it is common that the
counsel has vast experience in that type of litigation.
o If they dont, an individual case, or a couple of them, may lead to that
sort of information being developed.
o These are called bellwether trials.
Two Functions:
Exert some manner of preclusive effect vis--vis the
much larger number of untried, individual cases.
Exert no formal preclusive effect, but just inform in
rough manner the terms for the remaining cases
Figure out which laws are helpful/relevant
o Kind of like statistical sampling
o Which is kind of disfavored as trial by formula
MDL is for pre-trial, so how does it go about handling bellwether trials?
MDL Consolidation: if informative bellwether trials will advance resolution
of related civil claims, then which should be transferred?
o By injecting juries and fact-finding into MDL, bellwether trials assist
by providing opportunity for coordinating counsel to:
Organize the products of pretrial common discovery
Evaluate the strengths and weaknesses of their arguemtns and
evidence
Understand the risks and costs associated w/ litigation
Create trial packages.
Knowledge gained can precipitate global settlement

Attorneys Relationship to Plaintiffs

Three traditional ways for defining the relationship between class attorney
and the class.
o Class is aggregate of individuals: But class attorney doesnt have
traditional lawyer client relationship.

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o Class as an entity: Class attorney represents class as whole just as an

attorney represents corporation.
o Problem: Class rep lacks legitimacy held by corporate officers and
directors, except for lead plaintiffs in PSLRA, class rep lacks leverage
that a board has over its lawyers, need court approval to fire attorney.
o Private Attorney General Model: Represents both class and public
interest, someone must define what the public interest is, idea is that
the lawyer will come up with this definition.
Client Disclaimer:
o Once a class action plaintiff, you dont get the same sort of
invidualized A/C relationship that you would if it were a single suit.
o You get put in a pot with a number of other plaintiffs with varying
degrees of similarity to your claim.
o But it could be good/more effective, even if you dont get your
traditional day in court.

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